State Farm Mutual Automobile Insurance Company has been approved to proceed with its lawsuit against Spine Centers of America, alleging the company participated in a $3 million patient-brokering scheme, according to a March 26 report from Insurance Business Magazine.
A federal judge in Florida determined that State Farm had presented proof of violations to Florida’s Deceptive and Unfair Trade Practices Act.
State Farm’s lawsuit alleges that several surgeons, two outpatient surgical centers and Spine Centers created a billing scheme to maximize personal injury claim payouts from insurance.
It further claims that Spine Centers of America referred its patients to surgeons and centers involved in the scheme. Those surgeons and centers then charged patients a flat fee while also billing insurers for the full cost of procedures.
According to an example from State Farm, a surgeon was paid $2,000 for a procedure, but the spine facility billed State Farm $47,688.
While the surgeon network and centers moved to have the lawsuit dismissed, the judge found that State Farm adequately proved Spine Centers’ role in the scheme.
Unjust enrichment claims were also allowed to proceed against Spine Centers and its executive team, who allegedly profited from the illegal billing practices.